Tuesday, March 2, 2010

Not So Simple as a Simple Majority

The conservative publication National Review must be enjoying compiling a list of quotes on using "reconciliation" to get healthcare reform legislation through the Senate following the election of Scott Brown '41' as Massachusetts Senator. Here is the final quote:

“You know, the Founders designed this system, as frustrating [as] it is, to make sure that there's a broad consensus before the country moves forward. . . . And what we have now is a president who . . . [h]asn’t gotten his way. And that is now prompting, you know, a change in the Senate rules that really I think would change the character of the Senate forever. . . . And what I worry about would be you essentially have still two chambers — the House and the Senate — but you have simply majoritarian absolute power on either side, and that’s just not what the founders intended” (Sen. Barack Obama, Ill., remarks at the National Press Club, 4/26/05).There probably is a broad national consensus on certain aspects of potential change in the system. There is no consensus on the basic concept that the Federal government should control health insurance to see that it is as comprehensive - - i.e. expensive-- as the government mandates. What if the government were to mandate that no new car less than $35,000 could be purchased? It would argue that all the safety and convenience features meant that this really was not a more expensive car. It would further subsidize selected purchasers based on arbitrary and changeable criteria.

I have long felt that there are two critical areas needing reform. One is a safety net for catastrophic healthcare costs. Bill Clinton was advised that this could be put into place for the cost of "sin taxes" on tobacco and alcohol. Such an approach likely would have been wildly popular. Instead he went for a massively complicated approach that made it illegal to go outside the referral system, a la Canada. This approach would still be popular.

The other is more technical. It relates to the list and real prices by health care facilities, and to a lesser extent doctors, for their services. For example, the real cost of providing a multi-channel automated blood analysis might be a dollar or two. The retail price might be a hundred dollars or much more, and people without insurance are billed the full amount. However, if one has managed care insurance, the insurer knows the real costs and pays an appropriate profit for the analysis of the blood. Similar things go on with radiology services, general hospital care, and the like.

It would be easy to make it illegal to charge the uninsured more than a certain percentage above what a provider of health services willingly accepts from an insurer for a service. As is now stands, insurers have a scam. They can overcharge because almost everyone is terrified of being charged retail for even a short hospital stay. This is a form of 'protection' little different from small shopkeepers being 'protected' by whomever wants to extort money from them.

Here's the bigger picture. The government is already subsidizing health care massively, through tax deductions for employer-paid health care, through Medicare and Medicaid, and in lesser ways. The government is in horrible financial shape in good measure because of its decisions in 2008 that are ongoing to socialize the losses from the housing collapse. Tied into but not only related to housing, the large financial companies have been massively subsidized and Fed policy is continuing this implicit subsidy. The auto industry has been subsidized, as well.

The Federal government's own actuaries report that the current value of the unfunded promises the government has made to its own people are over $50 Trillion, and rising.

How on earth is this the correct time to create a new entitlement for first-quality health care?

It is a great goal that we all favor as people, actual or potential patients, and in my case as a physician.

The problem is that few people believe that the government really can fulfill all its current promises. Remember that Social Security is another worthy concept. This entitlement is not, however, first-quality. Try retiring on nothing but Social Security payments. Medicaid is not first-quality.

The idea that the powers that be in Washington are truly going to be able to deliver the quality of care that most Americans now get--courtesy of the healthcare industry and via heavy subsidies already-- but for more Americans and with the incentive to buy votes by increasing benefits-- is a dubious idea. The American people look at the rising cost and decreasing quality of the Postal Service, the fact that the head of the Ways and Means Committee and the Treasury Secretary feel that compliance with the rules don't apply to them, and want an incremental approach to improve the current system.

As Senator Obama said in 2005, major social legislation has, at least beginning with FDR, always had large majorities in favor both in public polling and in the Senate. This legislation, which is so personal, should be much more popular before it is enacted.

The public would have much preferred a jobs summit over a healthcare summit.

While large states such as California, New York and Illinois are in serious financial distress, a tone-deal majority in Washington is focused on expanding Federal power. Expansion of Federal power in the housing field, however, has had miserable long-term consequences. That should be a caution for a President who is (ineffectively) dealing with the fallout from that expansion of responsibility.

Most Americans share similar goals re health insurance. Most Americans also want government to engage in effective actions that both keep the government financially sound while allowing economic activity to rebound in a self-sustaining, balanced manner.

America is faltering largely because of internal economic and financial follies, both in the "free enterprise" system and in government. Make no mistake about it. The current depressed and fragile economy did not have to occur.

It was caused by such matters as lies, looting and corruption.

As JFK said, a rising tide lifts all boats. Barack Obama needs to channel Bill Clinton's 1992 campaign. It's all about the economy. Without a durable and strong economic expansion, government will simply not be able to deliver on his goals for high quality health insurance for all Americans, at least not without sacrifice in other sectors of the economy for which the public is completely unprepared.

Insurance is an after-the-fact thing. Fire insurance on a house only kicks in after the event has happened. If Americans ate "right", exercised, and abjured tobacco, they would be doing more good than any insurance scheme can do.

Mr. President, please focus your attention on the economy and national security. That dual focus made Ronald Reagan so successful also in difficult times. Please start over on health care reform and you can have popular legislation enacted by August, in time to help your party in the midterms.